Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
To generate an attractive total return for shareholders consisting of dividend income and capital growth through investments in specialty lending opportunities.
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Yes, as you say it's complicated isn't it? If c. 5% of the NAV = £11.9m that implies a value of c. £240m vs the current mcap of close to £150m , I think that would explain why there were some pretty big buy trades yesterday despite the uncertainty & timescales. It should be easier to work out the expected value once we see how many B shares we receive for each ordinary share we hold.
Thanks Krusty, but it wasn't what I meant! My fault, I put it badly.
What I mean is, they are returning 5.12% of the NAV (as at 31.01.24). But what have they had to let mature/equity sell to raise that 5.12%....If they had to liquidate 5.12% to pay us 5.12% (i.e. 100% conversion) then that would be a good sign. But if they had to liquidate say 8% to be able to pay us 5.12% that would be bad.
It's a complicated equation because there is significant debt repayment as well. We would need to know if there are any losses on the balance sheet loans and whether the equity is being sold at close to the level on the books.
We may not be given that information, so the next sign will be what happens to the NAV post the first redemption. Does the NAV drop by 5.12%, or more, or less?!
Guitarsolo
I'm assuming we'll receive c. 4 'B' shares for every ordinary share we hold, otherwise this equation doesn't work?
"The capital to be returned represents approximately 5.12 per cent. of the Company's Net Asset Value as at 31 January 2024."
Well it is nice to know that the first capital return is not far away with the first $15m.
The question is, what % of the loans have matured and equity been sold to raise that $15m (money was also directed to repay debt)?
My average is a touch over 83, don’t think I’ll see a full return on investment. :=((
Can't say the first B share payment is overwhelming!
The share price change agrees with me!
You have to start somewhere and we also have to take account the reduction in the RCF.
All in all a start on the long road to a total return of 80p....plus!
I live in hope!
I see two things happening on first return - fall but not equivalent in SP and a reduction in the discount to NAV
what's your ******* problem? this is a share discussion forum where people can express an opinion, but as usual some troll comes along & takes the ****. what are you adding to the debate ********?
Yes of course, they will be able to sell the least desirable assets first, I can’t believe I didn’t think of that myself. Good luck with the rest of your “forecasting” (making up crap).
I'm still forecasting c. 60p but happy to be proved wrong. Suspect they'll want to retain their dividend-paying investments for as long as possible, so will probably be disposing of the rump initially which might not yield too much (c. 10p?).
??
How else do you expect them to return capital to shareholders in a managed winddown? This is standard practice. At least by issuing & buying back/cancelling B shares there's no chance of investors missing deadlines, it'll all be done automatically with no shareholder action required.
"The Company expects to make an announcement in connection with an initial return of capital using the B Share Scheme next week"
So cash available to return to shareholders. Share price down ...no logic
CarpeDiem1
80 to 85p ìs roughly the money loaned, as there has been no sign of defaults it is a reasonable assumption that's what we will get that back. Or at least thats what's available. Windup costs/management fees may eat into it, specially as its a long drawn out affair.
Also in favour but will be interesting to see what the first return is
Thanks Krustysmegma
I don't think you need to worry about it Lfish. It won't matter which way us PI's vote, the II's will already have been consulted & will no doubt vote in favour. It's probably the safest, cheapest & easiest way to return funds to shareholders so I'll be voting in favour, just in case Schroders et al are asleep at the wheel.
How about the vote for the B shares ? Can everyone give some ideas please ? thanks
Krusty. I think/hope that 60p is on the pessimistic side. I would hope for at least 75p otherwise fully invested LTHs are royally screwed. Tempted to keep adding around this price
Gs yes this is where it gets difficult. As you say, in theory when the B shares are issued the SP should respond as if we'd gone XD. However, the NAV should drop by less than the implied B share value. That's the theory anyway, let's see how it pans out. This morning's RNS has already highlighted costs associated with the wind-down ("...net proceeds of realisations of investments will be dependent on the repayment and cancellation of the Company's bank facilities, further drawdowns to honour commitments to fund under existing contractual arrangements, the Company's liabilities and general working capital requirements...") and doubtless others will emerge as they attempt to realise the investments. I don't think we'll see more than 60p, personally, and that may well take two years or more IMV.
I agree with you there Krusty! However, I'm interested to see what happens to the share price. Let's say the first redemption is 20p per share (that's a bit high), will the share price drop by 20p to the low 30s? Theoretically it should, but then the discount to remaining NAV gets even bigger. It might wake people up to the fact that the returns should be much greater than the share price.
Good luck with that. The difficult part is going to be keeping track of how much has been returned over the coming years.
Some details of the Capital return today via issuing of B shares.
Should have a clearer idea about the projected value at The general meeting in early april. I am looking for 80p to 85p.
That's true , thanks anyway !
The wind up could be a slow process but the recently announced NAV held up pretty well. Also get a divi next week so I'm holding on. Too late to sell now I suspect